Monday, May 7, 2012

Seven business days

My US bank allows you to pay bills via the Internet. So I put in the details of my cable TV account, and then it said "payment will be sent by check, please allow 5 to 7 business days for payment". Unbelievable as it is, the US still uses cheques for a lot of payment. Even an automatic payment via Internet banking may very well be mailed by cheque and take over a week.

I found this hard to believe and have since joined a credit union which will pay many bills within a day. But even that has a strange twist. To pay off a credit card at another bank takes one day from the credit union "checking" account. However, to transfer money from my credit union checking account to my credit union Visa account takes three days for the payment to clear with Visa. It is quicker to pay my visa bill at another bank than make a transfer to the credit union Visa account.

Why does this all seem so old fashioned and really a bit ridiculous? Because in November 1997 all the Australian banks got together and agreed to introduce BPay. A single system for payments between billers and banks. A few years later it moved from phones to the Internet and means that Australians don't need give a minute's thought to how they will get money from one account to another or how they will get money to a biller. In the US you can often get by with credit cards, but for some things like rent and school excursions, you can only pay by cheque.

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